2005 Idaho Code - 63-3029 — CREDIT FOR INCOME TAXES PAID ANOTHER STATE

                                  TITLE  63
                             REVENUE AND TAXATION
                                  CHAPTER 30
                                  INCOME TAX
    63-3029.  CREDIT FOR INCOME TAXES PAID ANOTHER STATE. (1) A resident
individual shall be allowed a credit against the tax otherwise due under this
chapter for the amount of any income tax imposed on the individual, an S
corporation, partnership, limited liability company, or trust of which the
individual is a shareholder, partner, member, or beneficiary (to the extent
attributable to the individual as a result of the individual's share of the S
corporation's, partnership's, limited liability company's or trust's taxable
income in another state), for the taxable year by another state on income
derived from sources therein while domiciled in Idaho and that is also subject
to tax under this chapter.
    (2)  For purposes of this section, "state" shall include any state of the
United States, the District of Columbia, or any possession or territory of the
United States.
    (3)  The credit provided under this section shall not exceed the
proportion of the tax otherwise due under this chapter that the amount of the
adjusted gross income of the taxpayer derived from sources in the other state
as modified by this chapter bears to the adjusted gross income of the taxpayer
as modified by this chapter. This limitation applies to all individuals
whether the tax paid to the other state is paid by the individual or by an S
corporation, partnership, limited liability company, or trust. Further, the
credit shall not exceed the tax paid to the other state.
    (4)  To substantiate the credit allowed under this section, the state tax
commission may require a copy of any receipt showing payment of income taxes
to the other state or a copy of any return or returns filed with such other
state, or both.
    (5)  No credit allowed under this section shall be applied in calculating
tax due under this chapter if the tax upon which the credit is based has been
claimed as a deduction, unless the tax is restored to income on the Idaho
return.
    (6)  The credit shall not be allowed if such other state allows a credit
against taxes imposed by such state for taxes paid or payable under this act.
    (7)  For purposes of this section an income tax imposed on an S
corporation, partnership, limited liability company, or trust includes:
    (a)  A direct tax imposed upon the income for the taxable year of the S
    corporation, partnership, limited liability company or trust; and
    (b)  An excise or franchise tax that is measured by the income for the
    taxable year of the S corporation, partnership, limited liability company,
    or trust.
    (8)  For purposes of subsection (7) of this section, an excise or
franchise tax is "measured by income" only if the statute imposing the excise
or franchise tax provides that the base for the tax:
    (a)  Includes:
         (i)   Revenue from sales;
         (ii)  Revenue from services rendered; and
         (iii) Income from investments; and
    (b)  Permits a deduction for the cost of goods sold and the cost of
    services rendered.
    (9)  A part-year resident is entitled to a credit, determined in the
manner prescribed by the state tax commission, for income taxes paid to
another state in regard to income which is:
    (a)  Earned while the taxpayer is domiciled in this state; and
    (b)  Subject to tax in such other state.
    (10) If the interest in an S corporation, partnership, or limited
liability company was held for less than the entire taxable year, the share
attributable to the individual shall be allocated in the same manner as for
federal purposes.